ICAN Amendment Bill 2020: Matters arising

          *CITN, others oppose bill to make ICAN regulate tax practice

Perhaps, one key  thing that can be said  about the proposed Institute of Chartered Accountants of Nigeria (ICAN) Act of 1965 Amendment Bill  is that  it is tantamount to  making  ICAN the jack of all  trade of all  professions. What this translates to is  that  the bill seeks to outlaw the existing bodies that regulate other professions by making ICAN the sole regulator.

The bill, sponsored by Hon. Abubakar Yunusa Ahmad, aimed at empowering ICAN to regulate its members to practise accounting and taxation, among other professions, and this  has been seen as an encroachment into the statutory obligations of other professional bodies.

The Chartered Institute of Taxation of Nigeria (CITN), Institute of Chartered Secretaries and Administrators (ICSAN), Association of Forensic Accounting Researchers (AFAR), Taxpayers’ Rights Initiative (TPI), were among the professional bodies that took this position during the public hearing of the House of Representatives Committee on Finance last Tuesday, on the Institute of Chartered Accountants of Nigeria Act, 1965 (Amendment) Bill, 2020.

While  the CITN  supports  the Bill in general , it is  opposed to  “the unlawful attempt of using the Bill to usurp the regulation of tax practice and the tax profession by ICAN contrary to the Chartered Institute of Taxation of Nigeria Act, Cap. C10, Laws of the Federation of Nigeria, 2004, which is also an act of the National Assembly.”

In the course of his presentation, the Legal Adviser of the Chartered Institute of Taxation of Nigeria, Mr. Chukwuemeka Eze, cited the CITN Act No. 76 of 1992, which in its section 1 empowers the CITN to regulate and control the practice of taxation in all its ramifications.

ICAN Act (Amendment) Bill  provisions that are in breach of the CITN Act are as follows: Section 21 (Areas of Practice of a Chartered Accountant and creation of a new Section 15).The Principal Act is Amended by inserting immediately after the existing Section 14, a new Section 15 that is –  15. A Chartered Accountant shall be entitled to practice or hold himself out to practice as an Auditor, a Reporting Accountant, Financial Accounting and Corporate Reporting Services Practitioner, Financial Management Practitioner, Corporate Services Practitioner, Governance Risk and Compliance Services Practitioner, Tax Practitioner, an Investigations and Forensic Accounting Practitioner, an Accounting Information Systems Practitioner, an Insolvency Practitioner, a Public Finance Practitioner, a Management Consultant, Financial Advisory Services Practitioner and such other ancillary areas of Practice which may by Regulations made by the Council subject to the approval of the Minister be designated as services constituting the practice of a Chartered Accountant.

 In Section 28 (Interpretation)  of this Bill, unless the context otherwise provides –  Section 19 of the Principal Act is amended by renumbering it as Section 23 and substituting the existing interpretations with the following new interpretations that is –  “Accountancy practice” includes auditing, reporting accounting, investigation and forensic accounting, Financial Accounting and Corporate Reporting Services, Financial Management Services, Management Consultancy Services, Corporate Services, Governance Risk and Compliance Services, tax practice, accounting information systems practice, insolvency practice including receivership and liquidation, financial advisory services;

“Chartered Accountant” means an accountant enrolled as a fellow or associate member of the Institute, who practices as an auditor, Reporting Accountant, Accounting information systems practitioner, Tax practitioner, insolvency practitioner, corporate and public finance Practitioner, a management consultant.”

CITN is opposed  some provisions of the proposed amendment bill for two major  reasons  as follows: it will empower the  Council of one profession (ICAN) to regulate a distinct profession, outside its area of competence, (taxation), which is already being regulated by another  competent body (CITN);

 CITN and ICAN have been in various courts (High Court Lagos, Federal High Court Ikoyi, Lagos, Court of Appeal, Lagos Division, and the Supreme Court, since 2005 over the issue of regulation of the tax profession in Nigeria, with the decisions in favour of CITN. There are currently four  pending suits/appeals involving the two parties and/or their privies in at the Federal High Court, Ikoyi, Lagos, and the Court of Appeal, Lagos Division.

 Meanwhile, it is learned that the National Assembly had abandoned four previous attempts to amend the ICAN Act because of its extant rule not to dabble into matters that are pending before the judiciary.

It is an aberration in law and in practice to use a bill or law to usurp the regulation of a profession by a secondary regulator (ICAN), when the profession already has a primary regulator (CITN).

  As  stated by CITN, “from our research, there is no known equivalent where the National Assembly, through an Act established a body to regulate a profession, after 30 years of the existence of that Act, and without creating a new profession out of the existing one, proceeded to empower a secondary regulator to regulate the same profession.”

CITN, “this is what the Bill intends to achieve through sections 21 and 28 of the proposed Bill. The Chartered Institute of Taxation Act was enacted originally as Decree No. 76 of 1992. This is exactly 30 years of its existence and the Council of the Institute has been regulating the taxation profession. ICAN, which is an association of accountants, seeks to regulate both the accountancy profession and the taxation profession. This is illegal invasion of one profession by another.”

Section 8 of the Bill, which seeks to amend Section 3 of the ICAN Act, prescribes that the Council of ICAN should be constituted with 30 accountants: 19 of them in practice while 11 of them are not in practice. None of these 30 Council members is a Chartered Tax Practitioner. The obvious implication is that if the Bill is passed in its present contents, 30 accountants will be regulating the tax profession as a secondary regulator.

Section 21 of the Bill has surreptitiously turned a Chartered Accountant to a tax practitioner by fiat. This is akin to making a law to turn a medical doctor to a radiographer or decreeing by law that an accountant has become an economist. Although it is usually said that the law can turn a man into a woman, it is not always achieved through legal and logical absurdity, as intended in this case.

In past 14 years or more ,  there have been five attempts to amend the ICAN Act without success, principally because of this usurpation project. The introduction of the Bill at every session of the National Assembly has always attracted serious  oppositions (from other statutory professional bodies in the country including CITN) to the attempt by an accountancy body to regulate our profession.

At each occasion, the Honourable House discovered that this is grudge legislation, they applied the Pontius Pilate approach by washing off their hands and abandoned the Bill.

In its submission CTN says : “In order not to throw the child away with the bathwater, we urge this Honourable House to purge the Bill by deleting tax practice and tax practitioner in sections 21 and 28 of the Bill. Once this is done, the Bill can sail to harbour safely.

The two accounting bodies (ICAN and ANAN) that regulate the accountancy profession have existing Memorandum of Understanding with us on seamless initiation of their members into tax practice. Our MoU with ICAN was achieved after decades of court disputes, four of which are still pending. The last MOU was signed on 31st May, 2021, with the Federal Inland Revenue Service and the Joint Tax Board as witnesses.

ICAN had tried, in 1979, to scuttle the birth ANAN) on arrival through its members at the National Assembly .Oracle News learned  what happened   when  ANAN was formed in 1979  to counter alleged regressive grip of ICAN on the profession. A private bill sent  to  the National Assembly, where it passed the public hearing, despite stiff opposition against it. The battle was fiercer in the Senate, where it took 20 months after the House had passed the bill before it could be read for the second time.

  It was the regime of Gen Ibrahim Babangida (retd) whose decree opened up space for accounting bodies to function side by side.  Babangida  signed the ANAN Decree 76 into law in August 25,  1993. This marked the ushering in of a new accountancy body  in Nigeria. ICAN did not relent in its pursuit of getting ANAN proscribed.